Big Four supermarkets under threat, warns expert

Britain’s Big Four supermarkets must update their business models, or else be overtaken by discounters, a retail expert has warned.

Heiner Evanschitzky, professor of marketing at Birmingham’s Aston Business School said that with competition hotting up, Tesco, Sainsbury’s, Morrisons and Asda need to do more to stand out and get close to the discounters snapping at their heels.

His comments came after Waitrose Boss Mark Price said that supermarkets are 20 years out of date, adding that out of town supermarkets and the weekly shop were now a “thing of the past”.

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“Supermarkets need to strategically locate their smaller stores close to customers and – perhaps paradoxically – close to their competitors,” said Evanschitzky.

“The Big Four should for instance look at opening smaller stores next to Aldi supermarkets, focusing on a complementary range of products that consumers will buy as ‘treats’ after their cheaper discount shop.”

Looking ahead, retailers could and should go even further, looking at retail innovation in regions such as Asia, Evanschitzky suggested.

“In South Korea, ‘virtual shelves’ projected onto train station walls, allowing shoppers to simply click on the products they want with their phone, and by the time they are home, their shopping is there.

"This type of customer-focused, tech-savvy innovation is what the Big Four should be focusing on – not the price war that simply confuses and irritates consumers and suppliers," he added.

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